Construction spending continues to fall

Source: Construction Exec

Date :01/05/2008 10:37:41

The Commerce Department reported Thursday that U.S. construction spending continued to tumble in March, plummeting by a steeper-than-expected 1.1 percent as private home building suffered a record decline.

The March numbers were in stark contrast to revised numbers for February, initially reported as a 0.3 percent decline but revised upward to reflect a 0.4 percent increase. According to the report, at a seasonally adjusted annual rate of $1.124 trillion, construction spending fell to its lowest reading in March since June 2005.

Private home building dropped at a record 4.6 percent – the biggest monthly drop on records dating back to 1993. Conversely, private non-residential construction spending, which advanced by 1.9 percent, hit an all-time high seasonally adjusted annual rate of $382 billion.

The overall decline is the fifth in the past six months. In addition to the housing slump, the across-the-board economic slowdown has also played a role, leaving builders to struggle with reducing record inventories.

May 01, 2008